Brown and beige adipose tissues burn energy for heat production and have garnered much attention because of their capacity to reduce obesity and metabolic disease. Aging leads to an impairment in beige fat development in mice and people, predisposing to metabolic dysfunction and limiting the potential of beige fat-targeted therapeutics. Beige fat cells develop from adipose progenitor cells in response to certain stimuli, most notably cold exposure. These adipose progenitor cells can also develop into fibrosis-generating myofibroblast-like cells in the context of obesity. We noted that the beiging process in young mice reduced the fibrosis profile of adipose tissue progenitor cells. This fibrogenic-to-adipogenic shift in progenitor phenotype was regulated by the brown fat transcription factor PRDM16. Aging reduced the expression levels of PRDM16 in adipocytes, leading to a loss of beige fat development and an aggravated fibrosis response. Cell culture studies revealed that PRDM16 suppresses the fibrogenic activity of adipose progenitor cells via an unexpected paracrine pathway. Specifically, PRDM16-expressing adipocytes engage high levels of fatty acid oxidation and produce the ketone body ?-hydroxybutyrate (BHB). BHB acts on progenitor cells to block myofibroblast programing and facilitate adipogenesis. This activity of BHB depended on the ketolytic enzyme BDH1, suggesting that BHB regulates progenitor cells by re-wiring their metabolism. Finally, single cell expression profiling studies of adipose stromal cells identified a putative cellular source of aging-induced myofibroblasts. Altogether, these studies promote the hypothesis that BHB-catabolism in adipose progenitor cells suppresses fibrosis and stimulates beige adipogenic commitment. Therefore, raising BHB levels/signaling could potentially be targeted to ameliorate adipose fibrosis and restore beige adipocyte development during aging. In this project, we will use a combination of mouse models, genetic fate mapping, single cell RNA profiling analyses, and physiological assessments to investigate the novel role of ketone metabolism in regulating adipose tissue remodeling. Specific Aim 1 examines the in vivo physiological role of BHB-metabolism in regulating beige, brown and white fat cell differentiation in response to cold exposure and obesogenic conditions. Specific Aim 2 will elucidate the mechanisms by which BHB-catabolism represses fibrogenic responses and promotes adipogenic commitment in progenitor cells. Specific Aim 3 will determine the identity of fibro-adipogenic progenitors in adipose tissue and assess their differential activity in young vs. aged animals. Completion of this work will define a novel pathway that links tissue metabolic activity with control of progenitor fate and suggest new approaches to reduce metabolic and/or fibrotic disease.